“It is not over until it’s over: the General Court clarifies its approach to the admissibility of additional evidence relating to the substantiation of the earlier right ” by Stefan MARTIN
This article reflects the views and opinions of the author and not the position of the EUIPO.
(07/07/2021, T356/20, SYNDICATE, EU:T:2021:736)
- On 8 May 2013, the applicant filed an EUTM application for registration of the figurative mark in respect of various goods in classes 9 (Helmets), 25 (Clothing) and 28 ( Sporting articles). The mark was eventually registered on 27 December 2014.
- On 16 June 2015, a Swiss Company doing business under the name of Nile Clothing AG (the “Invalidity Applicant”) filed an application for a declaration of invalidity based on the international registration No 691975 in respect of the word mark SYNDICATE, designating inter alia the European Union registered on 26 March 1998 in relation to various goods in Classes 24 “Bath towels” and “Clothing” (the “Earlier right”).
- On 14 May 2019, the Cancellation Division rejected the application for a declaration of invalidity on the basis that the Invalidity Applicant failed to submit before the date of closure of the adversarial part of the proceedings proof of the renewal of the Earlier right. In the course of the proceedings before the Boards of appeal the Invalidity Applicant filed the renewal certificate of the earlier mark (the “additional evidence”).
- By decision of 31 March 2020 (‘the contested decision’), the Fifth Board of Appeal of EUIPO annulled the Cancellation Division’s decision of 14 May 2019 and declared the contested mark invalid for all of the goods for which it was registered (31/03/2020, R 1488/2019-5, Racing Syndicate (fig.) / Syndicate).
- The Board declared the additional evidence to be admissible. As a result, it also stated that the earlier mark invoked by the cancellation applicant in the current invalidity proceedings had been validly substantiated.
- The applicant filed an action for annulment alleging inter alia that the Board in accepting the additional evidence infringed article 95 (2) EUTMR and Article 27(4) of EUTMDR. The Court dismissed the action.
- The law applicable ratioane temporis to the issue of the admissibility of the additional evidence
At the crossroads between substance and procedure, the law of evidence has a hybrid nature ( E. Fongaro, « Des conflits de lois en matière de preuve », Revue critique de droit international privé 2018/1 (N° 1), pp. 80 à 87). In general, it is accepted that the determination of the means of evidence, their probative value and the question of the burden of proof is a matter of substantive law, whereas the administration of proof is a matter of procedure. The admissibility of belated evidence belongs to the second category. In line with settled law, the General Court affirms that procedural rules apply on the date on which they enter into force. As a result, the issue of the admissibility of the Additional evidence is governed by the procedural provisions of Regulation 2017/1001 (the “EUTMR) (at § 17).
- The admissibility of belated evidence
The Court starts the review of the case by recalling that pursuant to Article 95(2) EUTMR and Article 27(4) EUTMDR belated evidence remains admissible before the Boards of appeal provided that (a) it is likely to be relevant for the outcome of the case; and (b) they have not been produced in due time for valid reasons, in particular where they are merely supplementing relevant facts and evidence which had already been submitted in due time, or are filed to challenge findings made or examined by the first instance of its own motion in the decision subject to appeal (at § 23).
The Boards of Appeal have provided further clarification on this issue in decision No 2020-1 of 27 February 2020 of the Presidium of the Boards of Appeal on the Rules of Procedure before the Boards of Appeal (hereinafter the ‘BoA-RoP) and which entered into force on 27 February 2020.
Article 54(1) BoA-RoP determines that: facts or evidence submitted for the first time before the Boards of Appeal shall be disregarded by the Boards, unless such facts or evidence are prima facie likely to be relevant for the outcome of the case and: (a) are merely supplementing relevant facts or evidence which had already been submitted in due time; or (b) are filed to contest findings made or examined by the first instance of its own motion in the decision subject to appeal; or (c) were not available before or at the time the contested decision was taken; or (d) are justified by any other valid reason”.
This discretion applies to all types of proceedings before the Office including opposition proceedings and revocation or invalidity proceedings (21/11/2013, T-524/12, Recaro, EU:T:2013:604, § 60). Moreover, the admissibility of belated evidence is not subjected to the proof that the party was unable to to submit the evidence within the time limit or that said evidence was not available (26/09/2013, C-610/11, Centrotherm, EU:C:2013:912, § 117).
- The rationale behind the discretion
As outlined by the Court of justice in Arcol there is a public interest to have the dispute examined and decided on the basis of all the relevant facts: “By preserving, nevertheless, the possibility […] of taking into account facts and evidence submitted late by the parties, […] is […], likely to contribute to ensuring that marks whose use could later successfully be challenged by means of annulment or infringement proceedings are not registered. […], reasons of legal certainty and sound administration speak in favour of that approach […] (13/03/2007, C-29/05 P, Arcol, EU:C:2007:162, § 48).
More recently, the Court added that the discretion to admit belated evidence is also justified by the fact that the Boards are entrusted with the task to conduct a de novo examination as to the merits of the appeal, in terms of both law and fact. The Regulation also allows the Board is to invite the parties to file observations and to request the production by the parties of documents (24/01/2018, C-634/16P, FITNESS, EU:C:2018:30, § 37-39). This is a clear indication of the intention of the legislator outlined in Clause 42 of the Preamble of the EUTMR to ensure an “effective, efficient and complete review of decisions of the Office by the Boards of Appeal by means of a transparent, thorough, fair and equitable procedure” (see also EUTMDR: Preamble Clause 9).
- A ”broad discretion” to be exercised in considering the interest of both parties
The use in Article 95(2) EUTMR of the word “may” grants the Boards a broad discretion to admit or to reject the belated evidence (at § 24; see also 13/03/2007, C-29/05 P, Arcol, EU:C:2007:162, § 43, 45, 60-64; 05/03/2009, C-90/08 P, Corpo Livre; 18/07/2013, C-621/11 P, Fishbone, EU:C:2013:484, § 22; 26/09/2013,C–610/11P,Centrotherm, EU:C:2013:912, § 77; 24/01/2018, C–634/16P, FITNESS, EU:C:2018:30, § 56;03/10/2013, C-122/12 P, Protiactive, EU:C:2013:628, § 23). But at the same time, in exercising its discretion, the Boards should consider the interest of the other party. The admission of belated evidence may increase the complexity and the costs to defend the case, or result in further delay (in this regard. see the opinion of the Advocate General in 13/01/2016, C-597/14 P, Bugui va, EU:C:2016:2, § 62-63, 66). The issue of admitting belated evidence must be reviewed in light with the other party’s right of defence and the principle of equality of arms in inter partes proceedings (19/05/2021, T-510/19, DEVICE OF A Jumping ANIMAL (fig.)/Puma (fig.) et al., EU:T:2021:281, § 70). It follows that the parties do not enjoy an unconditional right to have facts and evidence submitted out of time taken into consideration by the Boards otherwise the provisions on time limits would be rendered redundant (26/09/2013,C-610/11P,Centrotherm, EU:C:2013:912, § 111 and 112; 24/01/2018, C–634/16P, FITNESS, EU:C:2018:30, § 56, 58).
- The notion of supplementary “evidence”
As is clear from the wording of Article 27(4) EUTMDR, the “evidence” will be considered as supplementary if it corroborates and expands on the documents already adduced during the first-instance proceedings (11/12/2014, T-235/12, Shape of a blade of grass in a bottle, EU:T:2014:1058, § 89) or to strengthen or to clarify the content of the initial evidence (see 13/03/2007, C-29/05 P, Arcol, EU:C:2007:162, § 44; 03/10/2013, C-120/12 P, Proti Snack, EU:C:2013:638, § 38; 28/03/2012 T-214/08, Outburst, EU:T:2012:161, § 51; 11/12/2014, T-235/12, Shape of a blade of grass in a bottle, EU:T:2014:1058, § 89). On the contrary, as to the situation when no evidence at all has been provided before the first instance, the Court has, for example, clarified that the new evidence must be rejected when the party has not submitted any proof of use within the time-limit set (18/07/2013, C-621/11 P, Fishbone, EU:C:2013:484, § 28). Indeed, “non-existent evidence cannot be supplemented” (28/05/2018, R 1609/2017-4, codecentric / CENTRIC et al., § 24).
- The judgment of the General Court
In the case under review, it is undisputed the late evidence was relevant for the outcome of the proceedings. The parties however disagree on the fulfilment of the second condition foreseen by Article 27(4) EUTMDR, namely that the Invalidity Applicant had valid reasons for not submitting the additional evidence in due time. Accordingly, the General Court was required to determine whether the renewal certificate, filed before the Board, may be characterised as “supplementing relevant facts and evidence which had already been submitted in due time, or are filed to contest findings [of the Cancellation Division]”.
The General Court observes that the renewal certificate of the earlier mark “SYNDICATE”, designating the European Union, Germany, France, Italy and Lithuania had been submitted in the course of the appeal proceedings with a view of challenging the conclusion of the Cancellation Division made on its own volition regarding the absence of proof of the renewal of the earlier right. In this regard one could argue that by definition additional evidence is filed to contest the finding of the First instance decision. The second argument is more persuasive. The General Court notes that the application for a declaration of invalidity of the contested mark was filed on 16 June 2015. At that time the earlier mark was validly registered as evidenced by an extract from WIPO’s Romarin official database filed by the cancellation applicant on 16 June 2015. From 16 July 2015 to 19 April 2018, the invalidity proceedings were suspended in view of pending of revocation proceedings filed against the earlier mark. The proceedings eventually were resumed, with the adversarial part concluded on 22 August 2018. In the meantime on 26 March 2018 the registration was renewed but the Cancellation Applicant failed to transmit the relevant renewal certificate to the Cancellation division. The suspension of the invalidity proceedings for a period of almost three years constitute a valid reason justifying the belated filing of the evidence of renewal of the earlier mark.
- Practical significance
The position adopted by the General Court is not revolutionary. In Rintisch and Grau the Court of justice had already confirmed that the Boards of Appeal discretion to admit supplementary evidence encompassed the proof of the existence and validity of the earlier right (03/10/2013, C‑121/12 P, Rintisch, EU:C:2013:639, § 34; 21/07/2016, C‑597/14, Grau, EU:C:2016:579, § 27). But the Court also indicated that with regard the proof of the validity of the earlier right, including proof of its renewal, the discretion should be exercised restrictively since the Regulation provides in detail the evidence to be submitted (03/10/2013, C‑121/12 P, Rintisch, EU:C:2013:639, § 34). The judgment under review clarifies that in certain circumstances which are not necessarily exceptional supplementary evidence of the renewal of an earlier mark may be admitted at the appeal stage. This liberal approach should be welcomed. But at the same time, it should not render time limits meaningless. In exercising their discretion the Boards should balance “the interest of a correct outcome, namely with the extended possibility to submit belated evidence, and the interests of the opposing party, namely, that proceedings are conducted with diligence and good faith, so as not to substantially change, or unnecessarily delay, them” (02/05/2018, R 643/2017-5, COREYSA / CORESA (fig.), § 83). Indeed, compliance with time-limits are a matter of public policy and their essential purpose is to ensure clarity and legal certainty. As outlined by the Advocate General Szpunar in Grau the parties should be encouraged to respect the delays set by the legislator or the Office and not to disregard them (Opinion of the Advocate General Szpunar in 21/07/2016, C 597/14 P, Bugui va / BUGUI et al., EU:C:2016:579, § 62, 63). As outlined by the Fifth Board of appeal the possibility to adduce evidence at the appeal stage should not be seen as a mean of improving the evidence filed before the First instance: “The Board notes the failure of the opponent to submit this material at first instance. It is simply included without comment or explanation in the appeal submissions. The Board has misgivings when litigants are blasé about such matters, effectively treating the Office’s first instance as a means of identifying the weaknesses in their case – which can then be rectified on appeal” (29/10/2015, R 1812/2014-5 – Comexio /Vomex, §15).
Furthermore, the importance of the judgment should not be overstated. Indeed, it appears clearly from the judgment that Article 95(2) EUTMR cannot be invoked to remedy the total failure to substantiate the earlier right. The belated evidence cannot be the “first evidence” (for example proof of national law pursuant to article 8(4) EUTMR -15/03/2021, R 1502/2015-2, ANNY / ANNYer (fig.) et al., § 36; 08/10/2021, R 1317/2020-5, Rubettes / Rubettes The Rubettes, § 76), proof of the existence and the validity of the earlier mark (24/10/2019, R 941/2019-4, ARVID NORDQUIST Selection SOLID (fig.) / Nordqvist (fig.) et al., § 23; 30/05/2018, R 1514/2017-2, Tino’s / BODEGAS LOS TINOS, § 42), translation in the language of the proceedings of the list of goods and services covered by the earlier mark (11/10/2021, R 580/2021-5, Arcshell / Arcshell, §§ 63-64).
Finally the judgment illustrates once again (see 24/01/2018, C–634/16P, FITNESS, EU:C:2018:30, § 43) that the parties would be well-advised to provide in their submissions to the Board valid reasons explaining the belated filing of the evidence.